Medibank shares sink as UBS sees positives in FY26 outlook
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More news: Medibank shares lowered after the health insurer's full-year statutory profit ticked up 1.7% and the company completed its final COVID give back package.
Shares were down 5.5% to $4.87 at 12:35pm AEST, having returned 25.4% over the last 12 months.
UBS analyst Kieren Chidgey said that while statutory profit was impacted by the company's final COVID give backs, underlying profit was 1% shy of consensus forecasts.
FY26 claim inflation guidance suggests more a stable health insurance net margin outlook relative to consensus declines, he said.
Medibank profit edges 1.7% higher, boosts dividend despite soft outlook
The news: Australia’s largest health insurer Medibank posted a 1.7% rise in annual profit, but flagged "moderating" industry growth in its resident health insurance business in FY26.
The numbers: Net profit after tax came to $500.8 million for the year, up from $492.5 million in the prior year but short of consensus estimates of $624.5 million, according to Visible Alpha.
Total revenue was up 5.2% year on year to $8.2 billion, but below average forecasts of $8.6 billion.
Medibank's full-year dividends of 18 cents per share are up from 17 cents last year and in line with analysts' expectations.
The context: Medibank CEO David Koczkar said the health insurance market "remains buoyant" with customer numbers at record levels. Net policyholder growth of 1.4% in Medibank's resident business is double last year's result, he said.
The company also announced that it has finalised its COVID-19 support package and give back program, and increased its most recent cash back commitment from $160 million to $228 million.
This will bring the total amount of support Medibank has provided to customers since the start of the pandemic to $1.71 billion, the largest financial give back from any Australian health insurer.
Customers will receive between $50 and $375, developing on the level of cover they have.
What they said: "At the start of 2020, we made a commitment that we would not profit from the pandemic while our customers' ability to claim on their health insurance was impacted," said Medibank's chief customer officer Milosh Milisavlkjevic.
"We're proud to have stuck. by that promise for over five years, and now as planned, we are finalising the give back program and returning further money to our customers."
The sources: ASX, UBS research
